All Government Bonds articles – Page 10
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White papers
US Stock-Bond Correlation: What are the Macroeconomic Drivers?
For the last 20y, the correlation between stock and bond returns has been negative, enabling CIOs to increase stock allocations, with bonds acting as a hedge, while still satisfying a given risk budget.
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Bond investors beware – US rates may rise sooner than thought
US bond markets have begun pricing in higher interest rates, specifically two 25 basis point (bp) increases in the benchmark fed funds rate by 2023.
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A Crack in China’s debt foundation
Bonds issued by China’s biggest distressed debt asset manager just lost 40% of their value—how concerned should we be?
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Three Strategies for Navigating Turbulent Bond Markets
Today’s market environment taps into bond investors’ primal fears. Extremely low yields make it tough to find sufficient income and potential return. Economic growth is rebounding from its 2020 collapse, but the world’s grip on recovery is uncertain.
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Fixed-income markets: from cyclical to structural challenges
Since the start of the year, bond yields have surged in the economies of the G10 as markets anticipate a sharp acceleration in inflation and economic activity. This rebound is likely to be particularly strong in the US given its enormous fiscal stimulus plan. In the medium term, opinion is divided concerning the post-Covid crisis macroeconomic trajectory and a possible change in the inflation regime in the US.
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A U.S. Treasury Bear is Born
Bear markets typically begin cloaked in a spirit of denial. Confutation can be virtuous because decline owns up to problems and making a change to solve them is often too painful. It’s human nature to seek pleasure to avoid pain. So, folks resist and hang on to their dogmas unyielding beliefs like “inflation hasn’t happened and can’t happen because demographics and technology won’t allow it to happen just look at Europe and Japan.” Certainly, an entire generation has grown to acquaint a bond bear but just for a brief “hello” and a more celebrated long “good-bye”.
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Increasing Yield with US Corporate Bonds
For 2021, with interest rates very low and spreads tight, investors are wondering where to turn in order to generate returns in the liquid fixed income universe. We will show that US credit investments offer attractive returns even after currency hedging. Due to a steep US yield curve, the expected return is higher than the current yield.
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Q2 2021 Investment View - Some like it hot
On the ground it does not feel like it just yet, as Europe battles with a third wave of infections, but markets are fast proceeding to the Covid crisis exit door. Too fast? We do not think so and see room for further rotation.
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Uncover new sources of income with taxable municipal bonds
Issuance of taxable municipal bonds, a segment of the overall municipal market, has increased in recent years, providing global institutional investors with an additional means of generating yield.
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High-yield bonds – Everything is relative!
Investors can still find value in the European high-yield bond market even after a more than volatile 2020 in which risk premiums fell.
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For diversification and returns: private debt and real assets
Investing in private debt and real assets can offer investors benefits such as attractive risk-adjusted return potential and real diversification, setting these ‘alternative’ markets apart from their traditional public counterparts.
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Biden’s First 100 Days: The roadmap ahead for capital markets
With the Georgia run-off elections giving the Democrats narrow control of Congress and President Biden’s inauguration behind us, investors can finally set their sights on the policies of the new administration. Broadly, markets have responded favorably across most risk assets as the uncertainty surrounding the election has finally passed.
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Supply vs demand of EMU EGB in 2021
Euro area sovereign debt issuance vs. ECB purchase dynamics look favourable in 2021. On the supply side, net issuance should decrease vs 2020, thanks to lower aggregated numbers of budget deficits, incoming support from EU funds, and for some countries, the use of increased cash accounts and higher bond redemptions.
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White papers
The Blue Wave & The Bond Market
The most notable event shaping the U.S. bond market to start the New Year was the outcome of the Georgia Senate races.
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Biden, Taxes and Your Portfolio
Higher personal taxation under a Biden administration could strengthen the case for municipal bonds and tax-managed equity strategies.
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ECB enters era of informal yield curve and spread control
The ECB is expanding its pro-growth and pro-inflation asset purchases and allowing the buying programme to run for longer. The objective is to safeguard favourable financial conditions as the eurozone grapples with the economic fallout of the COVID crisis. In effect, the ECB is encouraging investors to search for yield, particularly in those markets for risk assets where the ECB is active.
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Investment View - The New Age of Financial Repression
Given the surge in government and corporate debt, policy will inevitably focus on making this load sustainable: financial repression, spearheaded by central banks, is set to reach a whole new level.
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Fed’s policy shift may spell long-term trouble for bonds
Bond markets have taken the recent shift in the Federal Reserve’s policy framework in their stride, partly because interest rates are now expected to stay lower for even longer. But they look vulnerable if the Fed can revive inflation.
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Thematics: Eurozone government bonds, a supportive mix of remarkable funding progress and ECB QE still to come
Funding progress looked quite encouraging at July end for Eurozone government bonds, as roughly 80% of estimated yearly net issuance have been placed, mostly (more than 50%) in just four months, between April and July. Putting remaining supply in perspectives with ECB flows, the technical picture for EZ government bonds looks friendly to the current environment of low core yields and subsequent, persisting search for carry.